With first-time buyers all but excluded from the housing market unless they have significant funds to put down as a deposit, the future looks bright for buy-to-let investors.
Mortgage lending is subdued, meaning many of those who would normally buy have no choice but to rent until the economic climate improves.
That means there are a number of houses and flats in London and elsewhere that remain unsold, as those who would traditionally buy them are unable to do so.
Recent research conducted by Mortgages for Business seems to suggest that the situation is unlikely to change in the near future, with 60 per cent of landlords and property investors expecting to boost their portfolios by the end of the year.
Over the years many novice landlords have entered the buy-to-let sector, with some being hugely successful and others less so.
Below, we explore some of the issues you need to consider and steps you should take.
If you are in a position where you can afford to buy a property without credit then you are in a fairly strong position.
However, the majority of newcomers to the buy-to-let sector are not sat on significant cash reserves and if you are in the same position, you will need to take out a mortgage.
Many lenders require rent to cover 125 per cent of the mortgage repayments, although some have relaxed this criterion in recent years. Lenders will also require a deposit of anywhere between 15 and 25 per cent and you also need to take into consideration arrangement fees and other expenses.
It can therefore be a good idea to speak to a mortgage broker to find the most attractive deal available.
Key to any successful buy-to-let investment is choosing the right property in the right place for the right people.
That means you need to do plenty of research and identify areas that would appeal to the type of tenant you are targeting.
How good are the transport links? Are there schools in the area for families with young kids? What are the local amenities like? How much is the average rent in the area?
These are just some of the questions you need to ask yourself.
Identify your ideal tenant
Certain properties and areas will appeal to some people more than others and it is crucial that you identify the type of tenant you want so you can market a property that will appeal to them.
For example, a family with young children are unlikely to want to live in an area popular with students, so if you are targeting families make sure the area is likely to appeal to them.
Keep abreast of current affairs
There is a raft of legislation that landlords must comply with, including gas safety, electricity standards and other issues.
It is of the utmost importance that you know what is required of you and ensure the property meets the required standard.
Seek professional advice
There are a number of avenues you could explore to find out more about becoming a successful buy-to-let investor, with information available from the National Landlords Association and other bodies.
As well as the above points, you need to consider the resale value of the property, obtaining references, the day-to-day management of a buy-to-let portfolio and how to avoid the many pitfalls that others have fallen into.
It is therefore a good idea to discuss your plans with an estate agent or other professional to determine the best way forward.